Online Reporter
Nqobile Bhebhe, Zimpapers Business Hub
ART Holdings intends to complete the disposal of non-core assets during the 2026 financial year as part of measures to enhance liquidity, restore profitability and enforce strict cost control across its operations.
The Group will also relaunch its Softex tissue operations in Harare this month after successfully relocating and installing equipment following the closure of the Kadoma Mill.
In addition, ongoing product innovation — particularly the successful launch of the EV10 pen — is expected to sustain momentum in key market segments.
“Key priorities for the year ahead include completing the disposal of non-core assets to unlock liquidity, restoring profitability, maintaining strict cost discipline and leveraging the Group’s strong brands to regain market share.
“We are confident that ongoing Government reforms will continue to support a conducive operating environment, including stronger enforcement against illegal imports and counterfeit products, the encouragement of import substitution and local procurement, as well as improved macroeconomic stability,” the company said in its update for the year ended September 30, 2025.
The Group recorded turnover of US$28,3 million, representing a 17 percent decline compared with the prior year.
Overall volumes declined by five percent, reflecting the impact of reduced prices implemented to protect market share ahead of Statutory Instrument 34 of 2025, persistent liquidity challenges and intensified competition from imports.
Gross profit margins fell by 10 percentage points, resulting in an operating loss of US$0,8 million.
ART reported a loss after tax from continuing operations of US$1,4 million, which, combined with a US$2,2 million loss from discontinued operations, resulted in a total comprehensive loss of US$3,5 million for the year.
The Group said it responded to the challenging trading environment with disciplined cost management, achieving a 26 percent reduction in operating expenses — a key factor in limiting deeper losses and laying a foundation for recovery.
“Cost containment initiatives across the Group delivered a 26 percent reduction in operating expenses.
Liquidity preservation and operational realignment remained key priorities, with capital expenditure restricted to essential upgrades,” it said.
The company noted that receivables and high inventory levels remain key focus areas as it seeks to strike a balance between product availability and cash generation.
Performance across divisions was mixed, although several segments showed encouraging signs.
In the energy storage division, local battery volumes declined marginally by one percent despite supply chain disruptions, while volumes at Chloride Zambia fell by 25 percent due to intense competition and ongoing payment challenges.
However, export sales to Malawi and Mozambique grew by 11 percent, highlighting the benefits of regional diversification.
The division also streamlined its distribution model, shifting towards company owned retail outlets to improve operational control and efficiency.
The Stationery and Tissue segment recorded a steeper nine percent decline in volumes, driven by weak consumer liquidity, product returns in the first half of the year and sustained pressure from imports.
Nevertheless, the launch of the EV10 pen helped protect market share during the critical back to school period.
Most notably, the Softex tissue unit completed its relocation and installation of equipment, paving the way for a more agile and cost effective operation as production resumes this month.
“Volumes declined by nine percent compared with the prior year as weaker consumer liquidity in the first half necessitated product returns from cash constrained customers, disrupting normal demand cycles.
“The introduction of the new EV10 pen helped safeguard market share amid increased competition from low cost imports. Gross margins declined to 21 percent from 39 percent in the prior year due to pricing distortions during the peak back to school period.
“The division recorded an operating loss of US$0,6 million. Softex was largely in transition as tissue converting operations were relocated following the Kadoma Mill closure.
“Equipment installation was successfully completed and production is set to commence in January 2026.
“The streamlined operation is now more agile and better positioned for recovery. The loss for the year of US$0,25 million includes retrenchment and relocation costs,” the company said.
The Timber division at Mutare Estates emerged as a standout performer, with volumes increasing by 15 percent on the back of strong demand for structural timber, improved milling efficiencies, strategic pricing and tight cost control.
“Timber sales volumes exceeded prior year levels by 15 percent, driven by strong demand for structural timber and enhanced milling efficiencies. Gross margins improved as a result of strategic price increases and effective cost management.
“The partial disposal of Mutare properties resulted in a 23 percent decline in rental income and a loss on disposal of US$0,4 million.
“Illegal mining activity on the Inodzi Estate was successfully halted following a prolonged legal process, and the Group has since secured mining rights to enable active participation in the exploitation of the estate’s mineral resources,” it said.
ART Holdings manufactures and distributes products across three key categories: paper products, stationery and batteries.
Its diverse product portfolio ranges from tissue paper, sanitary ware and disposable napkins to writing instruments and automotive, solar and standby batteries.
The Group also has substantial interests in timber plantations and provides forestry resource management services.
